Taiwanese shoemakers shun subcontracting ban

MOVES to curb labor subcontracting in the Philippines are deterring Taiwanese shoemakers from investing.

In an interview, Roger Py, Philippine Footwear Federation Inc. director general and vice president for external affairs, said potential investors belonging to the Taiwan Footwear Manufacturers Association (TFMA) are wary of legislation that limit the number of contractual workers to a maximum of 20 percent of the workforce of a company.

“Taiwanese footwear manufacturers find subcontracting agency arrangements advantageous, so moves to remove this is a concern for investors,” Py said, citing some shoemakers in the past who suffered labor problems.

The Philippine Footwear Federation and the Philippine Economic Zone Authority for years have been wooing TFMA members to relocate to the Philippines, but Taiwanese shoemakers have deferred plans to set up shop here for various reasons, including lack of contiguous land and costs of labor and lease.

Py said same-old concerns such as labor issues and high power costs continue to discourage Taiwanese shoe manufacturers.

According to recent reports, TFMA has about 100 member-companies, many of which supply cheap footwear to US stores.

A number of the association’s members were reported to have transferred their factories in China to other low-cost locations such as Cambodia, Indonesia and Vietnam because of rising production costs in the mainland. —
Ben Arnold O. De Vera, Manila Times